Savient Pharma (OTC:SVNT) has been in the Growth Portfolio for several months after it and other small biotechs like Rigel Pharma (NASDAQ:RIGL) didn't surge with the soaring market in March. Luckily both have been hot in June. SVNT had a positive note from the FDA today. See this AP note. SVNT has the drug Krystexxa up for FDA panel review on Tuesday.
Analysts have been very divided on the approval of this drug as it clearly helps treat gout, but fears exist over the potential severe side effects. The biggest support for Krystexxa is that the population largely impacted by gout typically has severe medical issues beyond the gout problem so it isn't all that surprising to have patients see these cardiac issues whether they take the drug or not. The FDA note seems to signal that the benefits of this drug out weigh the side effects. Logically they'd get approval with some sort of label warning so it has been perplexing that several analysts had such negative comments such as the stock dropping to $2. With a disease that hasn't seem new drugs in 20 years, it would seem improbable for the FDA to block a drug that clearly works just because a few patients had severe side effects.
Being a one trick pony, this stock will be volatile, but for now the odds appear to favor staying long.
- "We are very encouraged with the FDA's listed items for discussion and believe they seem biased toward approval of Krystexxa," Kochnover wrote in a research note.
- He said Savient's drug can likely win approval so long as the company agrees to limit its use to the target patient population and closely monitor negative side effects. The company is specifically seeking an indication for gout patients who are not receiving relief from other treatments.
- Kochnover also noted that seven of the 16 panelists slated to vote on the drug are rheumatologists, specialists who treat gout and are likely to favor a new treatment.